- Fake Billing Scam uncovered by GST officers in Delhi
- The tax credit racket is said to be worth Rs 1,278 crore
- 1 person was nabbed by the authorities
- More than 9 places were raided in Delhi and Haryana
The anti-evasion branch of the Central Goods and Service Tax (CGST), Commissionerate, Delhi (East) uncovered a major racket, which generated fake bills worth close to Rs 1,278 crore, for fraudulently claiming Input Tax Credit (ITC).
A person has been arrested in connection with the incident, said the Finance Ministry on Thursday.
Once it received the intelligence, the officers of the CGST exposed a racket which was generating huge inadmissible Input Tax Credit through fake billing of approximately Rs 1,278 crore, read the statement issued by the Finance Ministry.
It was also said that the tax credit racket was operated by floating 7 different fake companies with the intent of “passing of inadmissible credit to the tune of Rs 137 crore”.
GST officers raided more than 9 places in National Capital and Haryana.
In order to identify the taxpayers who were defrauding the exchequer, the officers from the GST officer raided over 9 places, which were spread over different locations in the National Capital and Haryana.
The modus operandi of fraudulent taxpayers included the creation of bogus invoices/ bills without actual movement of goods. In addition, fake e-way bills were also being generated to show the transportation of goods.
The statement read, “The mastermind of the entire racket, Ashish Aggarwal, has been arrested under Section 132 of the CGST Act on October 29 and has been remanded to transit judicial custody,”.
It said that the primary beneficiary firm of this bogus billing network was M/s Maya Impex which has been registered in the name of Aggarwal’s 66-years-old mother, through which fake ITC of Rs 77 crore has been passed on.
“The fake billing operation was primarily engaged in generating and passing of fake ITC primarily to the milk products industry. Bogus invoices were raised against fictitious sale of milk products such as ghee, milk powder, etc.
“It is pertinent to mention here that apart from the other number of distinct companies, major brands like M/s Milk Food Ltd was one of the major beneficiary of this inadmissible credit,” the statement added.
As of now, and inadmissible ITC of more than Rs 7 crore has been recovered and further investigations are underway to expose other fictitious billing entities which have been associated with this syndicate and have defrauded the exchequer, the statement added.
The Directorate General of GST Intelligence (DGGI), Gurugram arrested one person on charges of creating and operating fictitious firms on forged documents and passing the fake ITC worth more than Rs 392 crore by way of issuance of invoices without any actual receipt or supply of goods or services.
Kabir Kumar, a resident of New Delhi, following his arrest, admitted to the creation of 31 such fake firms through which he had generated bogus invoices without any actual supply of goods and services which amounted to Rs 2,993.86 crore and ITC amounting to Rs 392.37 crore.
The Finance Ministry had said, “It is apparent from the investigation conducted till date, that Kabir Kumar created multiple proprietary companies merely on paper based in Gurgaon, New Delhi, Faridabad, Solan, Noida, Jhajjhar, Sirsa etc,”.
The Ministry added, “During the investigation of his premises, it was revealed that Kabir had also attempted to flee the city, however, he was prevented from doing so at IGI Airport by the DGGI Officers with the support of Customs and CISF officials,”.